Teleconferência de Resultados do 3T26 da XPLR Infrastructure (XIFR): Guidance para 2027 e Riscos Eólicos

Principais Destaques

• A XPLR Infrastructure registrou um EBITDA ajustado no terceiro trimestre de 2026 de aproximadamente US$ 471 milhões e um fluxo de caixa livre antes do crescimento de US$ 164 milhões.
• Os projetos existentes aumentaram o EBITDA ajustado em cerca de US$ 49 milhões na comparação anual e o fluxo de caixa livre antes do crescimento em US$ 24 milhões, principalmente devido a condições eólicas mais normalizadas e despesas operacionais líquidas favoráveis.
• A administração agora prevê que o EBITDA ajustado para o ano de 2026 fique na metade inferior da sua faixa de projeção anterior e que o fluxo de caixa livre antes do crescimento fique no limite inferior da faixa anterior ou próximo dele.
• Para 2027, a empresa espera um EBITDA ajustado de US$ 1,56 bilhão a US$ 1,70 bilhão e um fluxo de caixa livre antes do crescimento de US$ 525 milhões a US$ 600 milhões.
• Aproximadamente 85% dos trabalhos de repotenciação planejados para 2026 foram concluídos. A XPLR também vendeu cerca de 400 megawatts em ativos e direitos de interconexão durante os meses de agosto e outubro.
• A XPLR resgatou o saldo restante de aproximadamente US$ 33 milhões de suas notas não garantidas de 2026 em outubro, não restando vencimentos de dívida corporativa para o restante de 2026.

Principais Dados Financeiros

As comparações do terceiro trimestre também refletiram alienações de ativos concluídas em setembro de 2025. O fluxo de caixa livre antes do crescimento foi pressionado por menores receitas de investidores de tax equity, custos de financiamento de projetos mais altos associados ao programa de repotenciação de 2025 e maiores pagamentos de juros corporativos sobre aproximadamente US$ 1,75 bilhão em notas não garantidas emitidas em março de 2025.

Desempenho Negocial e Operacional

A XPLR concluiu aproximadamente 85% das repotenciações planejadas para 2026. A administração afirmou que o trabalho restante está progredindo e deve aumentar o valor de longo prazo do portfólio.

A empresa formou as duas primeiras joint ventures de armazenamento por bateria com a NextEra Energy Resources em julho. Além disso, concluiu a venda de aproximadamente 400 megawatts adicionais em ativos e direitos de interconexão em agosto e outubro.

Cerca de 200 megawatts foram vendidos em relação ao acordo de armazenamento por bateria, com os recursos devendo financiar parte do investimento líquido em capital próprio da XPLR em quatro projetos de armazenamento. Espera-se que os recursos dos outros aproximadamente 200 megawatts apoiem o reinvestimento nos projetos subjacentes.

A administração afirmou que a XPLR possui vários gigawatts de capacidade excedente de interconexão. A empresa planeja avaliar novas vendas diretas e estruturas de coinvestimento onde as avaliações e os benefícios de alocação de capital sejam atraentes.

A XPLR também está discutindo extensões e otimizações de contratos com potenciais contrapartes antes do vencimento dos acordos existentes. A administração afirmou que essas oportunidades podem melhorar a rentabilidade de longo prazo dos projetos e o fluxo de caixa livre antes do crescimento, embora sua contribuição para a projeção de 2027 seja incremental.

Projeções da Administração

A administração espera que o EBITDA ajustado para todo o ano de 2026 termine na metade inferior da faixa de projeção anterior. Espera-se que o fluxo de caixa livre antes do crescimento fique no limite inferior da faixa anterior ou próximo dele.

A projeção revisada reflete recursos eólicos e solares mais fracos do que o esperado na região Oeste, onde a XPLR possui contratos de compra de energia de maior valor. Também pressupõe recursos eólicos pelo menos 3% menores para o restante de 2026 devido às condições do El Niño. A administração estimou que cada variação de 1% na produção eólica de toda a frota afetaria o EBITDA ajustado em US$ 4 milhões a US$ 6 milhões ao longo do restante de 2026.

Para 2027, a XPLR prevê:

• EBITDA ajustado de US$ 1,56 bilhão a US$ 1,70 bilhão.
• Fluxo de caixa livre antes do crescimento de US$ 525 milhões a US$ 600 milhões.

O limite inferior incorpora um impacto potencial de aproximadamente US$ 32 milhões no EBITDA ajustado e de US$ 25 milhões no fluxo de caixa livre antes do crescimento decorrente de recursos eólicos mais fracos. A administração informou que isso pressupõe uma geração eólica cerca de 5,8% a 6% menor associada ao El Niño, concentrada no primeiro trimestre de 2027.

A administração identificou a expiração da elegibilidade a créditos tributários de produção para determinados ativos como o principal fator para a queda prevista no EBITDA ajustado em 2027. O efeito é parcialmente compensado à medida que as estruturas de tax equity maturam, aumentando a participação da XPLR nos fluxos de caixa dos projetos e simplificando as estruturas de propriedade.

Com base na sua projeção atual, a administração prevê que o fluxo de caixa livre antes do crescimento em 2028 fique em linha com o de 2027.

Riscos e Pontos de Atenção

• A variabilidade de curto prazo dos recursos eólicos e solares pode afetar materialmente a geração e a receita, particularmente quando a menor produção ocorre em regiões com contratos de preços mais elevados.
• As condições do El Niño podem reduzir os recursos eólicos durante o restante de 2026 e no início de 2027.
• Despesas de operação e manutenção mais altas estão incorporadas na projeção atualizada para 2026.
• A expiração da elegibilidade a créditos tributários de produção deve reduzir o EBITDA ajustado reportado em 2027.
• Custos de financiamento de projetos mais elevados e despesas com juros corporativos continuam sendo ventos contrários para o fluxo de caixa livre antes do crescimento.
• O desempenho de longo prazo depende em parte do controle dos custos operacionais e de manutenção e da execução de oportunidades de otimização de contratos.

Destaques das Perguntas e Respostas dos Analistas

A administração afirmou que os direitos excedentes de interconexão representam opções embutidas no portfólio que atualmente não geram caixa, mas que podem ser monetizadas ao longo do tempo. As vias potenciais incluem vendas diretas e coinvestimentos em armazenamento por bateria com a NextEra Energy Resources.

Com relação aos recursos retidos em determinados projetos, a administração informou que os fundos compensarão melhorias previamente planejadas nos controles dos locais e na infraestrutura de comunicação, em vez de financiar novos gastos identificados.

Em relação ao tax equity, a administração explicou que o efeito esperado no EBITDA ajustado de 2027 é um valor líquido que inclui compensações das contribuições de repotenciação e reajustes dos créditos tributários de produção. O fluxo de caixa livre é menos afetado porque captura apenas o resultado econômico dos créditos tributários retido pela XPLR após as alocações de tax equity de terceiros.

A administração caracterizou a recente fraqueza na geração na região Oeste como uma variabilidade de recursos no curto prazo, e não como um problema estrutural. As expectativas de longo prazo geralmente pressupõem condições climáticas normais, enquanto a projeção de curto prazo incorpora as estimativas mais recentes do El Niño.

Transcrição Completa da Teleconferência de Resultados

Transcrição completa da teleconferência de resultados

Comentários da administração

Operator

Good day, and welcome to the XPLR Infrastructure Third Quarter 2026 Earnings Call and Webcast. [Operator Instructions] Please note, this event is being recorded.

I would now like to turn the conference over to Kanghee Jeon, Director of Investor Relations. Please go ahead.

Kanghee Jeon

Good morning, everyone, and thank you for joining our third quarter 2026 financial results conference call for XPLR Infrastructure. With me this morning are Alan Liu, President and Chief Executive Officer of XPLR Infrastructure; and Jessica Geoffroy, Chief Financial Officer of XPLR Infrastructure. Alan will walk through our business highlights, and Jessica will provide an overview of our financial results. After that, our executive team will be available to answer your questions.

On this call, we'll be making forward-looking statements based on current expectations and assumptions, which are subject to risks and uncertainties. Actual results could differ materially from our forward-looking statements if any of our key assumptions are incorrect or because of other factors discussed in today's earnings news release, in the comments made during this conference call, in the Risk Factors section of the accompanying presentation or in our latest reports and filings with the Securities and Exchange Commission, each of which can be found on our website, www.xplrinfrastructure.com. We do not undertake any duty to update any forward-looking statements.

Today's presentation also includes references to non-GAAP financial measures. You should refer to the information contained in the slides accompanying today's presentation for definitional information and reconciliations of historical non-GAAP measures to the closest GAAP financial measure.

With that, I'll turn the call over to Alan.

Alan Liu

Thank you, Kanghee. Good morning, everyone. Since our last update, the XPLR team has continued to make progress across our key priorities. With repowering, execution remains on track. To date, we have completed approximately 85% of our planned repowerings for 2026. The remaining program is progressing and is expected to enhance the long-term value of our portfolio.

We also remain focused on our previously announced interconnection sales and battery storage co-investment agreement with NextEra Energy Resources. The first two joint ventures formed in July, and we'll continue to work on the remaining projects contemplated under the agreement. XPLR also completed the sales of approximately 400 megawatts of additional interconnection assets and rights to NextEra Energy Resources in August and October. Approximately 200 megawatts were sold in connection with the agreement with proceeds expected to fund a portion of XPLR's net equity investment in the four battery storage projects. Proceeds from the sale of the remaining approximately 200 megawatts are expected to support reinvestment in the underlying projects.

We continue to evaluate opportunities for monetization of interconnection assets and rights where they make economic sense. We view these transactions as an important example of the optionality embedded within our existing portfolio. We are leveraging existing interconnection assets and rights that are already part of our asset base to unlock incremental value and to redeploy capital across the portfolio, including to support reinvestment and incremental investment in storage, while maintaining a disciplined approach to capital allocation and balance sheet management.

We also continue to execute on our previously outlined financial plan by retiring the remaining approximately $33 million balance of our 2026 unsecured notes in October, leaving us with no remaining corporate debt maturities in 2026. Alongside this progress, we are seeing opportunities to enhance the value of our existing assets through contract optimization.

While we expect this opportunity to grow over time as more legacy contracts approach expiration, we are engaging with potential counterparties across multiple markets and evaluating opportunities to extend or optimize contracts where market conditions support attractive economics. We are seeing increasing interest in customers and beginning these discussions well ahead of contract expiration as they evaluate their longer-term power needs. We will remain disciplined in evaluating these opportunities. Our objective is not simply to extend contracts, but to pursue opportunities that can enhance the long-term economics and free cash flow before growth profile of the underlying assets.

With that, let me turn it over to Jessica.

Jessica Geoffroy

Thank you, Alan, and good morning, everyone. Let's turn to XPLR's detailed results. For the third quarter of 2026, XPLR's portfolio generated approximately $471 million in adjusted EBITDA and $164 million in free cash flow before growth.

Existing projects delivered a year-over-year increase of roughly $49 million in adjusted EBITDA and $24 million in free cash flow before growth, primarily reflecting more normalized wind resource compared with the prior year period and a favorable year-over-year comparison on net operating expenses. For free cash flow before growth, these benefits were partially offset by a decline in proceeds from tax equity investors and higher project financing costs related to the funding of our 2025 repowering program.

In addition, results for both adjusted EBITDA and free cash flow before growth reflect the impact of asset dispositions completed in September 2025. Free cash flow before growth was further impacted by higher corporate interest payments on the approximately $1.75 billion of unsecured notes issued in March 2025. Specifically, current quarter results reflect the full semiannual interest payments on those notes, whereas the payments in the prior year comparable quarter included only partial period of related interest expense.

Turning to our financial expectations for 2026. As we approach year-end, we have greater clarity on our full year outlook. We now expect full year adjusted EBITDA to finish in the lower half of our prior guidance range and full year free cash flow before growth to come in at or near the low end of the prior guidance range. There are a number of factors impacting our updated outlook for this year. While average wind and solar resource has been strong across the fleet overall this year, it has been weaker than expected in the West region. Unfavorable generation in the West creates more significant energy revenue reduction because the region contains higher value PPA contracts on a dollar per megawatt hour basis.

Looking to the balance of the year, our outlook also reflects expectations for at least 3% lower wind resource related to El Niño weather conditions. As a reminder, a 1% deviation in wind production across the fleet equates to $4 million to $6 million of adjusted EBITDA for the balance of 2026. In addition, we have incorporated slightly higher expectations for net operating and maintenance expenses for the rest of the year.

Today, we are also introducing our financial expectations for 2027. We expect adjusted EBITDA of $1.56 billion to $1.70 billion and free cash flow before growth of $525 million to $600 million. In establishing these ranges, we have considered a range of potential resource outcomes. The lower end of the ranges contemplates the potential impact from lower wind resource related to El Niño weather conditions anticipated in the first half of next year.

The primary driver of the expected step down in adjusted EBITDA for 2027 as compared to 2026 is the expiration of tax credit eligibility for certain assets within the existing portfolio. The anticipated roll-off of production tax credits reflects the normal maturation of our renewable energy portfolio. These credits were largely allocated to third-party tax equity investors, whose investments provided upfront financing for the projects. As the associated tax equity arrangements mature and investors achieve their targeted returns, we expect to benefit from simplified ownership structures and an increased share of project cash flows, partially offsetting the reduction in reported adjusted EBITDA.

For free cash flow before growth in 2027, the net expected impact from tax credit changes is roughly $25 million. This impact is less than for adjusted EBITDA because free cash flow before growth only reflects the portion of tax credit economics retained by XPLR and its unitholders after tax equity allocations. The year-over-year change in free cash flow before growth also reflects approximately $20 million higher net interest expense.

Looking ahead to 2028, based on our current outlook, we expect free cash flow before growth to be in line with 2027. Beyond that, we believe the underlying characteristics of the business support a durable free cash flow profile over the longer term, with several factors that could create upside from the existing portfolio. We anticipate continued benefits from investments under our existing capital plan as more projects come online.

The portfolio is also well positioned to capitalize on recontracting opportunities that we expect may emerge over the coming years. At the same time, delivering on this performance requires us to continue managing operations and maintenance costs and running the portfolio efficiently. As always, our expectations assume our usual caveats.

In summary, we continue to operate a large diversified portfolio of contracted infrastructure assets that generate meaningful free cash flow before growth. We are executing against the priorities we have previously laid out and are maintaining a disciplined approach to capital allocation and balance sheet management. Looking ahead, our focus remains on strong execution, maintaining financial flexibility, and pursuing opportunities that can enhance the long-term value of the portfolio for XPLR unitholders.

That concludes our prepared remarks, and we will now open the line for questions.

Operator

[Operator Instructions] The first question comes from Julien Dumoulin-Smith from Jefferies.

Perguntas e respostas

Anuhea Elliott

This is Anuhea Elliott on for Julien. So following the roughly 400 megawatts of interconnection asset and rights sale completed this year, could you just help quantify the remaining interconnection monetization opportunity across the portfolio? I guess, should we view these additional proceeds as recurring support for battery co-investments and project reinvestment? Or were these transactions more opportunistic?

Alan Liu

I appreciate that question. As we've noted before, XPLR owns multiple gigawatts of surplus interconnections, so we view these as embedded options within the portfolio. They are assets that don't generate cash today and can be over time monetized. And so we're going to continue to evaluate opportunities to monetize these where they make sense. As you've seen, we've demonstrated there's multiple pathways to monetizing them, including the battery storage co-investment opportunity that we've negotiated and collaborated with NEER. We've certainly pursued direct sales where that makes more sense. And so yes, we are going to continue to evaluate opportunities to monetize these assets.

Anuhea Elliott

Great. And then I guess my second question, for 2027 guidance, what brings you guys to the high and low end of the range, particularly with regard to what's assumed for the El Niño impact? You mentioned that you expect lower wind resources, but I guess any other color on the magnitude of that?

Jessica Geoffroy

Sure. It's Jessica. So for 2027, we did give specific sensitivities for lower wind resource on the El Niño front. So we incorporated into the lower end of the range for adjusted EBITDA, approximately $32 million potential impact and $25 million potential impact on the free cash flow before growth side. That equates to roughly 6% lower wind estimate that we have for El Niño in the first half of next year. In the first quarter. Sorry.

Operator

The next question comes from Nelson Ng from RBC Capital Markets.

Nelson Ng

Jessica, just to clarify, so on your El Niño assumptions, like obviously, you baked in some caution for Q4 of this year, but you're expecting from your guidance perspective that El Niño last from Q4 of this year through to Q1 and kind of stops there?

Jessica Geoffroy

Well, we said in the script, right, recall in my prepared remarks, we said in the first half of next year. The number that I quoted the $25 million is an assumption of roughly 5.8% lower wind resource concentrated in the first quarter of next year. Again, these are the best estimates we have at this time for both 2026 and 2027. The portfolio is subject to short-term resource variability, but those are the sort of best numbers that we have at this time in terms of estimate for El Niño impact.

Nelson Ng

Okay. Got it. And then next question just relates to the allocation of the proceeds from the interconnection sales. I know it's not a big number, but $12 million of the proceeds are being allocated to reinvestments in the underlying projects. Can you just clarify whether we should think of this as like organic growth CapEx? Or are you funding some like major maintenance or refurbishment that's needed in some of the underlying projects?

Alan Liu

Nelson, it's Alan. We had some planned upgrades to site controls and communications infrastructure at some of these projects. And so they were already in the plan. The opportunity that came up and to answer an earlier question, it was opportunistic to monetize the surplus interconnects at a attractive valuation. And money, once you've converted that option into cash, it's fungible. We're just planning on leaving the cash at the projects to offset the spending that was already planned.

Nelson Ng

Okay. Got it. And then just one last question. In terms of your guidance, like does the repowering plans and also, I know like the contract expirations are pretty limited in the next year or so. But does that have much of an impact on your guidance for next year? Or is it very incremental?

Alan Liu

In terms of the guidance, it's incremental, but we are bullish on this front. As we mentioned in the remarks, we are seeing traction in customer dialogue of people willing to engage with us on potential recontracting, reoptimization of the existing contracts well in advance of where the existing contract expires. So we're optimistic on this front. And so that we do think that there is incremental opportunity over the next couple of years.

Operator

[Operator Instructions] The next question comes from Anthony Crowdell from Mizuho.

Anthony Crowdell

Just hopefully, two quick questions. One on the tax equity roll-off. You said maturing tax equity gives you a larger share of the project cash flows. So how much of the '27 tax credit hit does that offset? And does that offset grow in '28?

Jessica Geoffroy

Yes. It's Jessica. So if you take a look at that $170 million number on adjusted EBITDA for the 2027 guidance versus 2026, that's a net number. So that's not directly, "Hey, here's the eligibility roll-off specifically for tax credits that came off assets that were expiring from their 10-year period." It's inclusive of the offset on repowering contributions and PTC escalators. So the net impact on adjusted EBITDA accounts for that.

On free cash flow for growth, right, you have a smaller number and a small variability, but you have adjustments for PAYGOs that change as tax equities come off. And then as there are tax equity investors who are effectively bought out of the structure through the allocation of tax credits, then they no longer get that small share of cash flows from the projects that they were getting. So all of that is baked into the expectations in those categories that we've laid out.

Anthony Crowdell

Great. And then just, I think you may have already hit it just on the weak west wind and solar, I think hit your higher-priced PPAs in '26. Is that only weather? Or is there something structural that may impact on your '27?

Alan Liu

I think that was more recent experience in 2026 that Jessica was referring to, right? If you think about our assets in California and WECC, generally much higher PPAs and SVP contracts, right, or contracts. And so this is a reflection of the fact that in the short term, you're going to have variability and it isn't always a direct correlation of overall megawatt hours to how it reflects on revenue, right? It's kind of dependent on which region is impacted by the megawatt hours.

Again, short term, you'll see this variability over the long term, these things even out. And as we provide expectations going forward, generally, we're assuming normal weather. It's just that as we look at El Niño and the information we're seeing, particularly as we're getting up-to-date reports every week on kind of the balance of the year, we felt it was prudent to start to incorporate some of that into the expectations in the short term.

Operator

This concludes our question-and-answer session, and the conference has now concluded. Thank you for attending today's presentation. You may now disconnect.